From July 1, 2025, shall business establishments with residual input VAT receive VAT refund upon dissolution in Vietnam?

From July 1, 2025, shall business establishments with residual input VAT receive VAT refund upon dissolution in Vietnam?

Based on Article 15 of the Law on Value-added Tax 2024 (effective from July 1, 2025), the regulation is as follows:

Value Added Tax VAT refund

...

3. business establishments that only produce goods and provide services subject to a 5% value-added tax rate, if they have residual input VAT from 300 million VND or more after 12 consecutive months or 4 consecutive quarters, are entitled to VAT refund. In cases where business establishments produce goods and provide services subject to multiple value-added tax rates, tax VAT refund shall be in accordance with the allocation ratio prescribed by the Government of Vietnam.

4. business establishments filing value-added tax using the deduction method are entitled to VAT refund upon dissolution or bankruptcy if there is excess payment or residual input VAT.

In the case of cooperative groups filing tax using the deduction method transitioning to cooperatives, the cooperative is entitled to inherit the excess or non-deducted input value-added tax of the cooperative group for deduction and VAT refund as prescribed.

5. Foreign nationals and Vietnamese residing abroad with passports or international travel documents are entitled to tax VAT refund for goods purchased in Vietnam taken abroad upon exit.

the Government of Vietnam shall regulate the dossiers, procedures, reimbursable tax amount, and VAT refund methods for the cases specified in this clause.

...

Thus, according to the above regulation, business establishments with residual input VAT will be reimbursed the value-added tax upon dissolution.

From July 1, 2025, shall business establishments with residual input VAT receive VAT refund upon dissolution in Vietnam? (Image from the Internet)

What is the time limit for processing VAT refund claims in Vietnam according to the Law on VAT?

According to clauses 1 and 2 of Article 75 of the Tax Administration Law 2019, the specific time limit for processing VAT refund claims is regulated as follows:

(1) For dossiers subject to prior VAT refund

For dossiers subject to prior VAT refund, the processing time is no later than 06 working days from the date the tax administration agency notifies the acceptance of the dossier and the processing time for VAT refund.

The tax administration agency must decide on the VAT refund to the taxpayer or notify the transfer of the taxpayer's dossier for prior inspection if it falls under the provisions of clause 2 of Article 73 of the Tax Administration Law 2019, or notify no VAT refund if the dossier does not meet the VAT refund conditions.

If the information declared in the VAT refund claim differs from the information managed by the tax administration agency, the tax agency shall notify in writing for the taxpayer to explain or provide additional information.

The time for explanation or additional information is not counted in the time limit for processing the VAT refund claim.

(2) For dossiers subject to prior inspection before VAT refund

For dossiers subject to prior inspection before VAT refund, the processing time is no later than 40 days from the date the tax administration agency provides written notice of dossier acceptance.

Within this processing time, the tax administration agency must decide whether to reimburse the taxpayer or not if the dossier does not meet the VAT refund conditions.

Note: If the above-mentioned time limit is exceeded due to delays caused by the tax administration agency, besides the reimbursable tax amount, the tax administration agency must also pay interest at a rate of 0.03%/day on the reimbursable amount and the days of delayed VAT refund.

Funds for interest payments are sourced from the central budget according to the provisions of the law on state budget.

Is there any change in the term of Value Added Tax in the new 2024 Law?

Article 2 of the Law on Value-added Tax 2008 states the term of value-added tax as follows:

Value Added Tax is the tax levied on the additional value of goods and services arising during the production, circulation, and consumption process.

Furthermore, Article 2 of the Law on Value-added Tax 2024 (effective from July 1, 2025) defines it as follows:

Value Added Tax is the tax levied on the additional value of goods and services arising during the production, circulation, and consumption process.

Thus, regarding the basic term in both the old and the latest current regulation, there is no change.